BANDAR SERI BEGAWAN, Oct 12 (NNN-BB NEWS) – The latest International Monetary Fund (IMF) 2019 country report, indicated that youth unemployment in Brunei poses a concern and needs to be addressed, which is now highest among ASEAN countries.
In the report, IMF recommended a need for strong economic growth and a structural labour market reform, to address the unemployment issue. The report also suggested the country to leverage on technology and digitalisation that could help turn Brunei’s young and tech-savvy population into an asset.
The report stated that the unemployment rate increased to 9.3 percent in 2017, from 6.9 percent in 2014, when the Labour Force Survey was last conducted. Youth unemployment rate increased from 25.3 to 28.9 percent, highest among ASEAN countries.
Unemployment for locals increased to 11.5 from 9.0 percent, with youth unemployment of locals rising to 31.7 percent from 29.9 percent. While unemployment rates for all levels of education are high, those with vocational background have the highest unemployment, underscoring the need for enhancing the quality of vocational training and reducing skill mismatches.
Based on international experience, IMF warned that large and persistent unemployment rates lead to skill attrition, depreciated human capital, outward migration of skilled labour, and an increase in social and political resistance to reforms. Long-term youth unemployment can even erode social cohesion.
IMF stated that youth unemployment is more sensitive to economic growth than adult unemployment. The sensitivity may be due to the concentration of youth unemployment in cyclically sensitive industries, such as manufacturing, wholesale and retail trade, hotels and restaurants, and SMEs, which employ a big share of the labour force.
Brunei should also focus on improving the flexibility of labour market, streamlining the public sector, scaling up quality training programmes, and reducing skill mismatches, IMF added.– NNN-BB NEWS